Suppose a Dell computer that sells for $2,000 in the U.S. is exported to the Netherlands. If the exchange rate is 2 Dutch guilders per U.S. dollar, then according to purchasing power parity theory, what would be the Dutch guilder price of the computer in the Netherlands?
a. 5000 guilders
b. 1000 guilders
c. 2000 guilders
d. 4000 guilders
d
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
Assume the average annual CPI values for 2015 and 2016 were 207.3 and 215.3, respectively. What was the percent increase in the CPI between these two years?
A) 3.86 B) 0.96 C) 8.0 D) 1.04
The level of unemployment that is equal to the frictional and structural rate in the long run is sometimes referred to as
A. the natural rate of unemployment. B. cyclical employment. C. the zero unemployment rate. D. the total rate of unemployment.
The 1996 Farm Act actually increased the level of government assistance to farmers.
Answer the following statement true (T) or false (F)